Barclays lowers 2020 oil price forecast by $12 a barrel

British multinational investment bank and financial services company Barclays announced Tuesday that it has lowered its oil price forecast by $12 per barrel for 2020.

The international benchmark Brent crude is now estimated to average $31 a barrel this year, while American benchmark West Texas Intermediate is expected to average $28 per barrel.

The bank said on Jan. 28 that crude oil prices could fall by $2 per barrel on average in 2020 due to the economic effects of the coronavirus outbreak, adding if air passenger traffic in China halves during the first quarter of 2020, it would lead to a 300,000-barrel-per-day loss in China's jet-kerosene demand.

That came before Saudi Arabia-led OPEC and Russia spearheaded non-OPEC failed on March 6 in Vienna, Austria to lower the collective oil production of the group known as OPEC+ to mitigate the adverse effects on coronavirus on global oil demand.

"Prices are likely to remain under pressure until the virus situation turns the corner, and if we continue on the projected market balances path, even Saudi Arabia and Russia will not be immune from the price fallout," the bank said in a note on Tuesday.

Barclays also said it forecasts an oversupply of more than 5 million barrels per day (bpd) in the global oil market this year, with the glut of supply estimated to peak at 10 million bpd on average during the second quarter of 2020.